Cryptocurrency user base surges in 2023, with defi outshining NFTs, reveals Flipside.
A comprehensive analysis of the ever-changing crypto landscape in 2023 has been unveiled by blockchain analysts Flipside, revealing significant user growth and evolving trends.
The report highlights that May 2023 saw a peak in acquired user volume, with over 8.8 million active accounts across multiple chains. This synchronized growth pattern across most chains suggests that overall market sentiments continue to drive the adoption of cryptocurrencies.
One notable observation from the report is the behavior of super users, which are defined as wallets with over 100 transactions. These users predominantly engaged in decentralized finance (DeFi) transactions rather than non-fungible tokens (NFTs). However, a trend reversal is seen on Layer 1 networks like Ethereum (ETH), where selling NFTs became more common. This indicates a shift of NFT investments to more cost-effective Layer 2 networks.
Flipside also noted the rise of new decentralized exchanges (DEXs) and NFT marketplaces in 2023. However, user activity remained concentrated on a few leading platforms such as Uniswap and OpenSea. This concentration is driven by network effects like asset liquidity and highlights the relative immaturity of the crypto market compared to traditional finance. Super users also exhibited varying preferences for secondary and tertiary DEXs, with a notable preference for selling NFTs.
In terms of user behavior, the report reveals that users predominantly interacted with a single chain, with 86.9% sticking to one network. However, a significant segment of users explored multiple Layer 2 networks, particularly between Polygon and other Ethereum Virtual Machine (EVM)-compatible layers. This indicates a growing comfort with cross-chain interactions.
Looking ahead, the report anticipates that the next bull run in the crypto market will be driven by diverse DeFi activities. This will challenge existing Layer 2 networks to lower costs and improve user experiences, ultimately leading to increased adoption of the Ethereum Virtual Machine. Additionally, the emergence of new chains catering to specific user needs is expected, resulting in more specialized ecosystems and use cases.
